The economic cognoscenti in this country — the ecognoscenti? — including senior figures in both the Liberal and Conservative parties and virtually all my columnist colleagues, believe Canada’s freshly minted foreign investment protection agreement with China (FIPA) is a no-brainer. Opposition to the FIPA, we are led to believe, is populist twaddle.

Likewise the related $15.1-billion bid by China’s state-owned oil company CNOOC Ltd. for Calgary-based Nexen Inc. is a slam dunk, or it should be. Nexen isn’t a major player; many of its assets are overseas. The booty is rich – $27.50 share, a 60-per-cent premium over the pre-bid price. It’s not as though incoming Chinese Communist Party General Secretary Xi Jinping – who, by the way, gave a peppy little speech at his formal unveiling in Beijing Thursday — will be camping out on the new Alberta cottage’s front lawn. This man has better things to do, such as managing the tiny, insular oligarchy that rules a fifth of the people on earth.

Canada, everyone with sense knows, must get in on the China gold rush while there’s still time. The United States is mired in $16-trillion of public debt; Europe is, as of Thursday, in recession for the second time in four years. Canada’s natural resources — 600 projects worth $650-billion ready to go — are the single ray of light. China will become the world’s largest economy by 2020. And because much of its territory is still relatively undeveloped, the raw-material need curve is just beginning.

All true. Now, however, I must interrupt this column with a nagging, impolitic passage from the U.S. Department of State’s human rights report on China, for 2011.

“As in previous years, citizens did not have the right to change their government. Other human rights problems during the year included: extrajudicial killings, including executions without due process; enforced disappearance and incommunicado detention, including prolonged illegal detentions at unofficial holding facilities known as ‘black jails’; torture and coerced confessions of prisoners; detention and harassment of lawyers, journalists, writers, dissidents, petitioners, and others who sought to peacefully exercise their rights under the law; a lack of due process in judicial proceedings; political control of courts and judges; closed trials…”

There’s more – much more. Well, yes, sigh our world-weary ecognoscenti, there are a few glitches over there. But how will the People’s Republic ever modernize if we don’t deepen mutual ties? China’s despotic, opaque institutions themselves are the best argument in favour of the FIPA, its proponents insist. “The main purpose of a FIPA,” declares a federal government backgrounder, “is to ensure greater protection to foreign investors against discriminatory and wholly arbitrary practices… “

Japan, it may surprise some to learn, has a FIPA with China. It was signed in 1989. Among other things, the agreement commits each party to protect the business interests and properties of the other. China is Japan’s largest trading partner and has been since 2007. In 2011, total two-way trade between the two Asian giants was worth US$344.9-billion – a new high.

Just weeks ago, amid a territorial dispute over miniscule, uninhabited islands in the East China Sea between Okinawa and Taiwan, there were mass protests in 50 eastern Chinese cities. Violent mobs trashed or burned Japanese-owned supermarkets, factories and car dealerships, while police stood by. The damage has since been estimated by the Japanese government at more than US$100-million. Japan’s FIPA with China, as you may have guessed, was of little use during the riots, or in their aftermath. Japanese businesses have been left to fend for themselves, seeking compensation in Chinese courts.

Incidentally, Japan has held the disputed islands since 1895. They are considered by the United States to be a part of Japanese territory and are explicitly covered under The United States’ Mutual Co-operation and Security Pact with Japan, signed in 1960.

At a little-reported forum in Ottawa last month North American security experts were asked to comment on how Chinese state-owned enterprises are different from, say, Canadian corporations. Ray Boisvert, formerly deputy director of Canada’s spy agency, CSIS, summed up the consensus view, as I have written before: They operate as organs of the communist party. This, of course, is why the Nexen deal has become such a hot potato: CNOOC is not just a company. It’s an arm of the Beijing ruling clique. Rejection of the bid therefore means rejection of the clique. Because the clique utterly controls the country, that in turn will be taken to mean a rejection of China itself.

Is this not, to use the precise economic jargon, seriously messed up? The Conservative government blundered into this on the assumption that dealing with China is just like dealing with any other trading nation. It isn’t. In attempting to rush the FIPA through with no discussion or study, let alone a credible plan of engagement, the government guaranteed it would become controversial. It now finds itself in a Catch-22. Extrication will not be easy.